Limited Fluctuations in the Shandong Region Asphalt Market This Week

November 21st News

Recent fluctuations in the asphalt market have been limited. According to monitoring data, on November 14, the factory price of #70 heavy traffic asphalt in Shandong region of China was 3,010 CNY/ton, and by November 21, the ex-factory price in Shandong had risen slightly to 3,030-3,040 CNY/ton.

From a national supply perspective, the asphalt production rate has decreased, with many companies shutting down or switching production. Among them, Shengxing in Shandong has switched to producing residual oil. In the coming weeks, Qilu Petrochemical and refineries under Sinopec may resume production, which will increase the supply pressure in the Shandong region.

On the demand side, downstream construction activities in southern regions continue to show steady demand. In Shandong, as weather conditions improve, projects are gradually wrapping up, with most supplies offered at lower prices. Meanwhile, in the northwest, declining temperatures are bringing project completions closer, though this has slightly dampened overall demand. In contrast, the northeastern region is experiencing accelerated inventory reduction—driven by a narrowing window for construction work, coupled with traders cutting prices to boost sales. This, combined with increased "catch-up" demand, is helping to speed up the process of reducing stock levels.

Let's look at the fundamentals of asphalt, which have not changed much. Demand is gradually shrinking, and oil prices are generally weak. The enthusiasm for stocking up among midstream and downstream players is being suppressed. Currently, winter storage contracts for asphalt have not yet entered the market. Next week, asphalt is expected to show a slight and weak fluctuation.